As the MAP process is acknowledged to be inefficient, ineffective and time-consuming, the OECD will establish a peer review process to monitor performance of countries’ in resolving Mutual Agreement Procedure (MAP) cases. The reviews should be ready in 2017.
Paascal Saint-Amans, director of the OECD’s Centre for Tax Policy and Administration, has stated: “I don’t know how successful the (BEPS) project will be in the long term, but what is for sure is that we have fed the political beast – the G-20 leaders and finance ministers – and they still have a lot of appetite. They are asking us for more. They need some more blood.”
The OECD’s Working Party 1 and the Forum on Tax Administration have started the peer review process under BEPS Action 14. Reviews will consist of checking number of cases, time needed to resolve, etc.
OECD believes this is a game-changer due to new accountability. However, without full transparency into what countries are doing, or not doing, how effective will the new peer review process be? The level of transparency should be commensurate with the transparency demanded from multinationals. It is hopeful this process will be a revolution for MAP, although many practitioners will be adopting a wait-and-see attitude.